1) The cumulative infrastructure investment needs in the US are projected to be $2.7 trillion by 2020 and $10 trillion by 2040 under current trends, leaving investment gaps of $1.1 trillion by 2020 and $4.7 trillion by 2040.
2) Failing to address these investment gaps will result in higher costs to businesses and households totaling over $1.8 trillion by 2020, reducing economic output and employment.
3) By 2020, the cumulative cost to the US economy is projected to be more than $3.1 trillion in lost GDP and 3.5 million lost jobs. By 2040, losses are expected to be almost 7 million jobs, $2.5 trillion in
The document discusses the American Recovery and Reinvestment Act (ARRA) of 2009, which provided $48 billion in stimulus funding for transportation projects. It explores the difficulties in estimating the economic impacts of such a large stimulus program. Research found that state highway spending increased by 50 cents to 75 cents for each $1 of ARRA highway grants received by a state. While precisely measuring impacts is challenging, analysis of multiple data points suggests that without ARRA funding, national highway spending would have declined 20% from 2008 to 2011.
Financing The New Economy New America Heartland Bankdroby
The document proposes the creation of the Heartland Development Bank, a $10-25 billion source of financing for infrastructure projects in America's Heartland regions. It would serve as a lead lender to leverage private and public co-investment for economically significant projects. Modeled after development banks like the IDB, it would obtain capital from state and federal governments, private investors, and regional organizations to fund things like transportation, renewable energy, and advanced manufacturing that current federal resources cannot fully support alone. The goal is to capitalize on emerging economic opportunities in the Heartland through strategic public and private infrastructure investment.
This document summarizes the 2002 Status of the Nation's Highways, Bridges, and Transit report. It finds that increased investment in highways and bridges since 1998 has led to improved physical conditions but worsening operational performance due to increased congestion. Future investment needs are projected to be significantly higher to maintain conditions and performance levels. For transit, record federal funding under TEA-21 was matched by state and local governments, leading to increased total investment.
The document discusses the state of aging U.S. infrastructure and opportunities for private investment growth through public-private partnerships. It notes that an estimated $2.2 trillion is needed over 5 years for infrastructure improvements, while only $975 billion is expected from government funding, leaving a $1.2 trillion gap that could be filled by private capital through partnerships. Several factors are driving increased interest in infrastructure investing, including an Obama stimulus package and the need to address critical sectors like roads and bridges that received poor grades in a recent infrastructure report.
Assignment ib- twists and turns in globalisation (autosaved)krishymohan
The document discusses the twists and turns in the debate around globalization in light of recent economic crises. It summarizes the subprime mortgage crisis in the US and the EU sovereign debt crisis, and their effects on globalization. Specifically, it argues that (1) the crises have highlighted the need for stricter regulations and fiscal measures to control cross-border capital flows and reduce risk-taking, and (2) international cooperation is required to establish frameworks that promote sustainable globalization and prevent future crises. However, some see the need for protectionist measures as well due to discontentment with globalization following the economic turmoil.
The document provides an overview of the state of the U.S. economy, construction industry, and surety industry in 3 parts. It notes that the U.S. economy is overdue for a minor correction, private construction sectors continue to boom while public remains flat, and the surety industry has experienced a decade of low loss ratios and flat premium growth despite soft market conditions.
U.S. Airline Industry Summer Travel Forecast and First Quarter 2013 Financial...Airlines for America (A4A)
The document provides an overview and analysis of the U.S. airline industry in the first quarter of 2013. It summarizes that:
1) The Airlines for America (A4A) projects a slight increase in summer air travel, which would narrow the gap to the 2007 peak levels. International travel is expected to reach a new record high.
2) Major U.S. airlines reported a narrower net loss in the seasonally weak first quarter of 2013 compared to the same period in 2012, helped by continued restructuring efforts.
3) Financial results are leading analysts to forecast that U.S. airlines will finally generate an economic profit in 2013, enabling investment in fleets, facilities
Constraints on economic development revision packMatthew Bentley
This document discusses several key constraints on economic growth and development, including infrastructure gaps, primary commodity dependence, macroeconomic instability, conflicts and corruption, and human capital weaknesses. It provides examples of each constraint in different countries and regions. Infrastructure deficiencies like inadequate power, roads, sanitation and transportation networks increase costs for businesses and limit connectivity. Reliance on volatile primary exports also exposes countries to economic shocks from falling commodity prices. Conflicts, corruption and poor governance undermine stability, investment and equitable resource allocation.
The document discusses the American Recovery and Reinvestment Act (ARRA) of 2009, which provided $48 billion in stimulus funding for transportation projects. It explores the difficulties in estimating the economic impacts of such a large stimulus program. Research found that state highway spending increased by 50 cents to 75 cents for each $1 of ARRA highway grants received by a state. While precisely measuring impacts is challenging, analysis of multiple data points suggests that without ARRA funding, national highway spending would have declined 20% from 2008 to 2011.
Financing The New Economy New America Heartland Bankdroby
The document proposes the creation of the Heartland Development Bank, a $10-25 billion source of financing for infrastructure projects in America's Heartland regions. It would serve as a lead lender to leverage private and public co-investment for economically significant projects. Modeled after development banks like the IDB, it would obtain capital from state and federal governments, private investors, and regional organizations to fund things like transportation, renewable energy, and advanced manufacturing that current federal resources cannot fully support alone. The goal is to capitalize on emerging economic opportunities in the Heartland through strategic public and private infrastructure investment.
This document summarizes the 2002 Status of the Nation's Highways, Bridges, and Transit report. It finds that increased investment in highways and bridges since 1998 has led to improved physical conditions but worsening operational performance due to increased congestion. Future investment needs are projected to be significantly higher to maintain conditions and performance levels. For transit, record federal funding under TEA-21 was matched by state and local governments, leading to increased total investment.
The document discusses the state of aging U.S. infrastructure and opportunities for private investment growth through public-private partnerships. It notes that an estimated $2.2 trillion is needed over 5 years for infrastructure improvements, while only $975 billion is expected from government funding, leaving a $1.2 trillion gap that could be filled by private capital through partnerships. Several factors are driving increased interest in infrastructure investing, including an Obama stimulus package and the need to address critical sectors like roads and bridges that received poor grades in a recent infrastructure report.
Assignment ib- twists and turns in globalisation (autosaved)krishymohan
The document discusses the twists and turns in the debate around globalization in light of recent economic crises. It summarizes the subprime mortgage crisis in the US and the EU sovereign debt crisis, and their effects on globalization. Specifically, it argues that (1) the crises have highlighted the need for stricter regulations and fiscal measures to control cross-border capital flows and reduce risk-taking, and (2) international cooperation is required to establish frameworks that promote sustainable globalization and prevent future crises. However, some see the need for protectionist measures as well due to discontentment with globalization following the economic turmoil.
The document provides an overview of the state of the U.S. economy, construction industry, and surety industry in 3 parts. It notes that the U.S. economy is overdue for a minor correction, private construction sectors continue to boom while public remains flat, and the surety industry has experienced a decade of low loss ratios and flat premium growth despite soft market conditions.
U.S. Airline Industry Summer Travel Forecast and First Quarter 2013 Financial...Airlines for America (A4A)
The document provides an overview and analysis of the U.S. airline industry in the first quarter of 2013. It summarizes that:
1) The Airlines for America (A4A) projects a slight increase in summer air travel, which would narrow the gap to the 2007 peak levels. International travel is expected to reach a new record high.
2) Major U.S. airlines reported a narrower net loss in the seasonally weak first quarter of 2013 compared to the same period in 2012, helped by continued restructuring efforts.
3) Financial results are leading analysts to forecast that U.S. airlines will finally generate an economic profit in 2013, enabling investment in fleets, facilities
Constraints on economic development revision packMatthew Bentley
This document discusses several key constraints on economic growth and development, including infrastructure gaps, primary commodity dependence, macroeconomic instability, conflicts and corruption, and human capital weaknesses. It provides examples of each constraint in different countries and regions. Infrastructure deficiencies like inadequate power, roads, sanitation and transportation networks increase costs for businesses and limit connectivity. Reliance on volatile primary exports also exposes countries to economic shocks from falling commodity prices. Conflicts, corruption and poor governance undermine stability, investment and equitable resource allocation.
Less Blah Blah More Ah Ha | Tennessee Association Of Realtors | Session Two |...Ken Brand
The document discusses strategies for real estate agents to market themselves and generate business online and in-person. It provides tips for using social media like Facebook effectively, including posting status updates, liking others' posts, sharing content, and commenting on posts. It also recommends in-person activities like open houses, direct mailers, and following up with past clients and leads. Throughout, it emphasizes the importance of consistent contact and conversation to build relationships and make sales.
This document contains three real estate market reports summarizing housing data for the Magnolia, TX area over the period of December 2012 to December 2014. The reports provide monthly statistics on average and median home sale prices, average price per square foot, and average days on the market. Additional metrics analyzed include the months supply of inventory and average days on market for homes listed as under contract. The data demonstrates modest increases in home prices and decreases in days on market over the two-year period.
Spring TX REal Estate Reports - May 2013 | BHGREGGKen Brand
Our Market Reports are ready to ponder and share like Johnny Appleseed. The Woodlands, Magnolia and Spring = Average and Median Sold Prices, Average Prices Per Square Foot, Days On Market and Months Supply Of Inventory. If you're into real estate or a real estate data geek, these reports are for you. https://www.evernote.com/pub/kenbrand/may2013marketreports
Less Blah Blah More Ah Ha | Tennessee Association Of Realtors | Session One |...Ken Brand
The document discusses four new realities facing businesses: 1) how and what products are sold, 2) increased competition, 3) how citizens make choices, and 4) "digital Darwinism". It emphasizes the need to focus on sharing, serving, solving problems and simplifying for customers in order to compete and be chosen. Trust, relevance, being remarkable and repetitive promotion are also highlighted as important strategies.
pdxMindShare's October Career-Focused Workshop on LinkedInpdx MindShare
This document provides tips on using LinkedIn to get job alerts, build relationships with influencers, and optimize your profile. It recommends expressing your strengths in a 2,000 character profile summary targeted to your industry culture. Additionally, it suggests identifying mutual connections and people who can help with your job search, then customizing invitations to connect and engage with them by finding a genuine affinity and explaining how you can help each other.
You woke up this morning thinking, I wonder where I can find reliable Demographic Data for The Woodlands. You know, stuff like, what's the median household income, how many children in The Woodlands, how many houses are there...stuff like that. Well, if you wondering, here's the down-low.
Failure to Act: The economic impact of current Investment Trends in surface ...Ports-To-Plains Blog
This report seeks to provide an objective analysis of the economic implications of the United States’ continued underinvestment in infrastructure. The Report Card for America’s Infrastructure, published every four years by the American Society of Civil Engineers, grades the current state of 15 national infrastructure categories on a scale from A through D for gradations of excellent to poor, and F for failing. This report answers the question “So what?” In terms of economic performance, what does a D mean? What does an F mean?
Failure to Act: The economic impact of current Investment Trends in surface ...Ports-To-Plains Blog
This report seeks to provide an objective analysis of the economic implications of the United States’ continued underinvestment in infrastructure. The Report Card for America’s Infrastructure, published every four years by the American Society of Civil Engineers, grades the current state of 15 national infrastructure categories on a scale from A through D for gradations of excellent to poor, and F for failing. This report answers the question “So what?” In terms of economic performance, what does a D mean? What does an F mean?
This report analyzes the economic impacts of failing to invest in America's infrastructure systems. It finds that by 2020, cumulative infrastructure investment needs will reach $2.7 trillion, but only 60% is expected to be funded, leaving a $1.1 trillion gap. This gap will negatively impact the US economy, resulting in nearly $3.1 trillion in lost GDP and 3.5 million lost jobs by 2020. The costs to businesses and households are projected to exceed $1.8 trillion by 2020 due to higher costs from deteriorating infrastructure.
Australia in Transition: Disruption breeds new infrastructure investment oppo...Turlough Guerin GAICD FGIA
Technological disruption is creating new opportunities for infrastructure investment in Australia. Driverless vehicles, renewable energy, and other disruptive technologies will impact demand for Australian infrastructure and may challenge existing regulations. While this creates uncertainty, it also provides opportunities to develop innovative infrastructure solutions through private sector investment to support Australia's growing population. Maintaining stable economic policies will be important to attract global investors seeking opportunities in new infrastructure.
Australian infrastructure-audit-key-findingsChidi Izuwah
This document summarizes key findings from the Australian Infrastructure Audit Report. It finds that Australia's infrastructure is struggling to meet the high standards of living expected by Australians. Population growth is increasing demand, especially in major cities, straining existing infrastructure. There are also gaps between infrastructure quality expectations and willingness to pay for necessary improvements. The report calls for integrated long-term planning across all levels of government, improved project selection, and consideration of alternative funding models to sustainably fund needed infrastructure upgrades and expansion.
The document discusses the context surrounding Scotland's infrastructure needs. It notes that infrastructure investment is key to driving economic growth but must also ensure resilience against challenges like climate change and demographic shifts. While major projects have stimulated growth, future output is expected to decline without continued investment. The report recommends taking a holistic, long-term approach to assessing infrastructure needs and prioritizing projects to support sustainable growth and international competitiveness. Devolution of additional powers could impact infrastructure planning and funding models going forward.
IMAP global Infrastructure Sector Leaders look at the current state of the Infrastructure sector and why it’s necessary for governments to continue to try to bridge the infrastructure gap generated by recent global underinvestment.
They detail the trends impacting the M&A landscape now and moving forward and identify the key market players and investors. They also share insights on the unique characteristics of the US Infrastructure market.
Emerging markets’ infrastructural sector — at a tipping point aranca special ...Aranca
While the gap between required and actual investment continues to widen, Aranca suggests selective investment strategy in emerging markets’ infrastructural sector. Know more on infrastructure investing from our investment research experts.
Journal of Comparative Economics 38 (2010) 34–51Contents lis.docxcroysierkathey
Journal of Comparative Economics 38 (2010) 34–51
Contents lists available at ScienceDirect
Journal of Comparative Economics
j o u r n a l h o m e p a g e : w w w . e l s e v i e r . c o m / l o c a t e / j c e
Infrastructure development in China: The cases of electricity, highways,
and railways
Chong-En Bai a,b,*, Yingyi Qian a,c
a School of Economics and Management, Tsinghua University, Beijing 100084, China
b National Institute for Fiscal Studies, Tsinghua University, Beijing 100084, China
c University of California, Berkeley
a r t i c l e i n f o
Article history:
Received 21 October 2009
Available online 27 October 2009
JEL classification:
H44
L9
O14
R42
R48
Key words:
Infrastructure
Electricity
Highway
Railway
China
0147-5967/$ - see front matter � 2010 Published b
doi:10.1016/j.jce.2009.10.003
* Corresponding author. Address: School of Econo
E-mail addresses: [email protected] (
1 One commonly used approach is to estimate th
infrastructure (for example, Aschauer, 1989; Munnel
(for example, Hulten and Schwab, 1991; Tatom, 1991
Morrison and Schwartz (1996) and Lynde and Richmo
Li (2005) adopts a third approach and uses the chang
return to infrastructure investment. He finds significa
and Fan and Zhang (2004) and they both find positi
infrastructure increases property value (Haughwout, 2
Ying, 1988).
a b s t r a c t
Bai, Chong-En, and Qian, Yingyi—Infrastructure development in China: The cases of elec-
tricity, highways, and railways
This paper considers the development of the electricity, highway, and railway sectors in
China, with special emphasis on investment incentives. Statistical summary of the devel-
opment of these sectors is offered, followed by a detailed description of the institutional
background, including investment and pricing mechanisms. We also analyze investment
incentives based on the institutional background and present our estimates of the rates
of return to investment in these sectors. It is observed that some of the current practices
may serve as useful transitional arrangements even though they are not desirable in the
long run. Journal of Comparative Economics 38 (1) (2010) 34–51. School of Economics and
Management, Tsinghua University, Beijing 100084, China; National Institute for Fiscal
Studies, Tsinghua University, Beijing 100084, China; University of California, Berkeley.
� 2010 Published by Elsevier Inc. on behalf of Association for Comparative Economic
Studies.
1. Introduction
There is a large literature studying the importance of infrastructure to economic development.1 However, there is not
much systematic research on how infrastructure is developed. Many issues are worth consideration. One of these issues is
investment incentives. Infrastructure may yield significant social returns. However, this does not guarantee that investors of
infrastructure projects can get sufficient private return. How can one provide incentives for private investment? If there is
not sufficient private incentive to i ...
IRJET- Factor Analysis of the Significant Drivers Causing Cost Variation in B...IRJET Journal
This document discusses cost variation in building construction projects in Tanzania. It identifies 48 drivers that can cause costs to vary from initial budgets and contract amounts. Through factor analysis, these 48 drivers are reduced to 19 significant drivers. The 19 drivers are then grouped into 5 categories based on common factors: 1) designer related drivers, 2) building element drivers, 3) process stage drivers, 4) general drivers, and 5) human/external drivers. The first four drivers in the designer category have high loadings, indicating they are major contributors to cost variation. Financial condition of the owner has the highest loading in the building element category. Unforeseeable ground conditions has a high loading in the process stage category. Therefore, the 5
IRJET- A Review on “Impact of Large Infrastructure Project on Local Econo...IRJET Journal
This document reviews the impact of large infrastructure projects on local economies. It discusses how infrastructure projects bring development to surrounding areas through job creation, housing, education, healthcare and retail opportunities. People working on infrastructure projects need local facilities to support their families. Existing local facilities may need to be upgraded to accommodate growth from these projects. The document also reviews several other studies and literature that have examined the relationship between infrastructure development and economic growth. In general, the research shows infrastructure is crucial for economic development and acts as a foundation for society, though the exact impacts may vary in different contexts.
The Impact of Infrastructure Spending in Sub-Saharan Africa: A CGE Modeling A...Dr Lendy Spires
This working paper uses computable general equilibrium (CGE) models to compare the impact of increased infrastructure spending in six African countries. The models include seven sectors and capture country specificities. Simulations analyze the impact of investments in nonproductive, road, electricity, and telecom infrastructure under different funding schemes. The results show that economic structure influences outcomes more than the identical models. Infrastructure investments have varying sectoral effects depending on each country's trade patterns and capital-labor ratios. Foreign aid most strongly impacts sectors due to price and exchange rate adjustments needed to balance the current account.
Developing Africa’s Infrastructure for Enhanced Competitiveness 2013Dr Lendy Spires
The Africa Competitiveness Report 2013 benefit from globalization through investment and trade. To achieve this calls for the construction of an efficient and secure national and cross-border physical infrastructure as well as a coherent system of regulation for business transactions.3 Infrastructure is also critical for the promotion of inclusive and sustainable growth. Rural infrastructure— notably feeder roads and transmission lines that connect rural communities to national grids—enable individuals, households, communities, and small businesses to embark on income-generating activities thanks to improved access to electricity and links to markets. The use of renewable energy or environment-friendly sources of energy—including solar, wind, geothermal, and hydropower, with all of which Africa is well endowed— would contribute to making growth sustainable. A considerable investment in infrastructure that uses innovative sources of funding is needed to address Africa’s low level of competitiveness (see Chapter 1.1). Indeed, the Programme for Infrastructure Development in Africa (PIDA) estimates that Africa will need to invest up to US$93 billion annually until 2020 for both capital investment and maintenance.4 Given the substantial amounts involved, governments will need to be innovative in the search for sustainable approaches to infrastructure development as well as financing. The private sector will need to play an increasingly important role. Governments will do well to create conditions where private-sector engagement is encouraged, probably through public-private partnerships (PPPs). Efficiency gains from performance improvements in infrastructure provision are themselves a significant source of finance,5 and the development of infrastructure bonds as a financing vehicle will need to be encouraged. Adequate maintenance plans are prerequisites for sustainable infrastructure. Maintenance is not only corrective but also preventative because it inspects assets and reduces the risk of failure. Costs associated with statutory maintenance can be substantial—even considerably larger than the value of the asset—yet providing for these maintenance costs is crucial. Without adequate maintenance, infrastructure deteriorates quickly and is unsustainable. Indeed, the longer-term performance of the ICT sector should be reviewed in light of the adequacy of maintenance plans. Thus far, ICT sector performance has been good, albeit from a low base.
The infrastructure sourcebook provides an overview of infrastructure issues, current challenges, and proposals for managing challenges over the next 25 years. It aims to inform policymakers, leaders, and development practitioners. The sourcebook defines infrastructure components, identifies lessons from case studies, and discusses the government's roles in areas like regulations, planning, commissioning, operations, and supply chain management. It also outlines the design and delivery process for infrastructure projects.
Economic Development 411 | 2015 | Robert PalterOne Columbus
Robert Palter—director, McKinsey & Company—leads the global Infrastructure Practice at McKinsey & Company, and specializes in helping clients identify infrastructure investment opportunities and manage infrastructure assets.
Less Blah Blah More Ah Ha | Tennessee Association Of Realtors | Session Two |...Ken Brand
The document discusses strategies for real estate agents to market themselves and generate business online and in-person. It provides tips for using social media like Facebook effectively, including posting status updates, liking others' posts, sharing content, and commenting on posts. It also recommends in-person activities like open houses, direct mailers, and following up with past clients and leads. Throughout, it emphasizes the importance of consistent contact and conversation to build relationships and make sales.
This document contains three real estate market reports summarizing housing data for the Magnolia, TX area over the period of December 2012 to December 2014. The reports provide monthly statistics on average and median home sale prices, average price per square foot, and average days on the market. Additional metrics analyzed include the months supply of inventory and average days on market for homes listed as under contract. The data demonstrates modest increases in home prices and decreases in days on market over the two-year period.
Spring TX REal Estate Reports - May 2013 | BHGREGGKen Brand
Our Market Reports are ready to ponder and share like Johnny Appleseed. The Woodlands, Magnolia and Spring = Average and Median Sold Prices, Average Prices Per Square Foot, Days On Market and Months Supply Of Inventory. If you're into real estate or a real estate data geek, these reports are for you. https://www.evernote.com/pub/kenbrand/may2013marketreports
Less Blah Blah More Ah Ha | Tennessee Association Of Realtors | Session One |...Ken Brand
The document discusses four new realities facing businesses: 1) how and what products are sold, 2) increased competition, 3) how citizens make choices, and 4) "digital Darwinism". It emphasizes the need to focus on sharing, serving, solving problems and simplifying for customers in order to compete and be chosen. Trust, relevance, being remarkable and repetitive promotion are also highlighted as important strategies.
pdxMindShare's October Career-Focused Workshop on LinkedInpdx MindShare
This document provides tips on using LinkedIn to get job alerts, build relationships with influencers, and optimize your profile. It recommends expressing your strengths in a 2,000 character profile summary targeted to your industry culture. Additionally, it suggests identifying mutual connections and people who can help with your job search, then customizing invitations to connect and engage with them by finding a genuine affinity and explaining how you can help each other.
You woke up this morning thinking, I wonder where I can find reliable Demographic Data for The Woodlands. You know, stuff like, what's the median household income, how many children in The Woodlands, how many houses are there...stuff like that. Well, if you wondering, here's the down-low.
Failure to Act: The economic impact of current Investment Trends in surface ...Ports-To-Plains Blog
This report seeks to provide an objective analysis of the economic implications of the United States’ continued underinvestment in infrastructure. The Report Card for America’s Infrastructure, published every four years by the American Society of Civil Engineers, grades the current state of 15 national infrastructure categories on a scale from A through D for gradations of excellent to poor, and F for failing. This report answers the question “So what?” In terms of economic performance, what does a D mean? What does an F mean?
Failure to Act: The economic impact of current Investment Trends in surface ...Ports-To-Plains Blog
This report seeks to provide an objective analysis of the economic implications of the United States’ continued underinvestment in infrastructure. The Report Card for America’s Infrastructure, published every four years by the American Society of Civil Engineers, grades the current state of 15 national infrastructure categories on a scale from A through D for gradations of excellent to poor, and F for failing. This report answers the question “So what?” In terms of economic performance, what does a D mean? What does an F mean?
This report analyzes the economic impacts of failing to invest in America's infrastructure systems. It finds that by 2020, cumulative infrastructure investment needs will reach $2.7 trillion, but only 60% is expected to be funded, leaving a $1.1 trillion gap. This gap will negatively impact the US economy, resulting in nearly $3.1 trillion in lost GDP and 3.5 million lost jobs by 2020. The costs to businesses and households are projected to exceed $1.8 trillion by 2020 due to higher costs from deteriorating infrastructure.
Australia in Transition: Disruption breeds new infrastructure investment oppo...Turlough Guerin GAICD FGIA
Technological disruption is creating new opportunities for infrastructure investment in Australia. Driverless vehicles, renewable energy, and other disruptive technologies will impact demand for Australian infrastructure and may challenge existing regulations. While this creates uncertainty, it also provides opportunities to develop innovative infrastructure solutions through private sector investment to support Australia's growing population. Maintaining stable economic policies will be important to attract global investors seeking opportunities in new infrastructure.
Australian infrastructure-audit-key-findingsChidi Izuwah
This document summarizes key findings from the Australian Infrastructure Audit Report. It finds that Australia's infrastructure is struggling to meet the high standards of living expected by Australians. Population growth is increasing demand, especially in major cities, straining existing infrastructure. There are also gaps between infrastructure quality expectations and willingness to pay for necessary improvements. The report calls for integrated long-term planning across all levels of government, improved project selection, and consideration of alternative funding models to sustainably fund needed infrastructure upgrades and expansion.
The document discusses the context surrounding Scotland's infrastructure needs. It notes that infrastructure investment is key to driving economic growth but must also ensure resilience against challenges like climate change and demographic shifts. While major projects have stimulated growth, future output is expected to decline without continued investment. The report recommends taking a holistic, long-term approach to assessing infrastructure needs and prioritizing projects to support sustainable growth and international competitiveness. Devolution of additional powers could impact infrastructure planning and funding models going forward.
IMAP global Infrastructure Sector Leaders look at the current state of the Infrastructure sector and why it’s necessary for governments to continue to try to bridge the infrastructure gap generated by recent global underinvestment.
They detail the trends impacting the M&A landscape now and moving forward and identify the key market players and investors. They also share insights on the unique characteristics of the US Infrastructure market.
Emerging markets’ infrastructural sector — at a tipping point aranca special ...Aranca
While the gap between required and actual investment continues to widen, Aranca suggests selective investment strategy in emerging markets’ infrastructural sector. Know more on infrastructure investing from our investment research experts.
Journal of Comparative Economics 38 (2010) 34–51Contents lis.docxcroysierkathey
Journal of Comparative Economics 38 (2010) 34–51
Contents lists available at ScienceDirect
Journal of Comparative Economics
j o u r n a l h o m e p a g e : w w w . e l s e v i e r . c o m / l o c a t e / j c e
Infrastructure development in China: The cases of electricity, highways,
and railways
Chong-En Bai a,b,*, Yingyi Qian a,c
a School of Economics and Management, Tsinghua University, Beijing 100084, China
b National Institute for Fiscal Studies, Tsinghua University, Beijing 100084, China
c University of California, Berkeley
a r t i c l e i n f o
Article history:
Received 21 October 2009
Available online 27 October 2009
JEL classification:
H44
L9
O14
R42
R48
Key words:
Infrastructure
Electricity
Highway
Railway
China
0147-5967/$ - see front matter � 2010 Published b
doi:10.1016/j.jce.2009.10.003
* Corresponding author. Address: School of Econo
E-mail addresses: [email protected] (
1 One commonly used approach is to estimate th
infrastructure (for example, Aschauer, 1989; Munnel
(for example, Hulten and Schwab, 1991; Tatom, 1991
Morrison and Schwartz (1996) and Lynde and Richmo
Li (2005) adopts a third approach and uses the chang
return to infrastructure investment. He finds significa
and Fan and Zhang (2004) and they both find positi
infrastructure increases property value (Haughwout, 2
Ying, 1988).
a b s t r a c t
Bai, Chong-En, and Qian, Yingyi—Infrastructure development in China: The cases of elec-
tricity, highways, and railways
This paper considers the development of the electricity, highway, and railway sectors in
China, with special emphasis on investment incentives. Statistical summary of the devel-
opment of these sectors is offered, followed by a detailed description of the institutional
background, including investment and pricing mechanisms. We also analyze investment
incentives based on the institutional background and present our estimates of the rates
of return to investment in these sectors. It is observed that some of the current practices
may serve as useful transitional arrangements even though they are not desirable in the
long run. Journal of Comparative Economics 38 (1) (2010) 34–51. School of Economics and
Management, Tsinghua University, Beijing 100084, China; National Institute for Fiscal
Studies, Tsinghua University, Beijing 100084, China; University of California, Berkeley.
� 2010 Published by Elsevier Inc. on behalf of Association for Comparative Economic
Studies.
1. Introduction
There is a large literature studying the importance of infrastructure to economic development.1 However, there is not
much systematic research on how infrastructure is developed. Many issues are worth consideration. One of these issues is
investment incentives. Infrastructure may yield significant social returns. However, this does not guarantee that investors of
infrastructure projects can get sufficient private return. How can one provide incentives for private investment? If there is
not sufficient private incentive to i ...
IRJET- Factor Analysis of the Significant Drivers Causing Cost Variation in B...IRJET Journal
This document discusses cost variation in building construction projects in Tanzania. It identifies 48 drivers that can cause costs to vary from initial budgets and contract amounts. Through factor analysis, these 48 drivers are reduced to 19 significant drivers. The 19 drivers are then grouped into 5 categories based on common factors: 1) designer related drivers, 2) building element drivers, 3) process stage drivers, 4) general drivers, and 5) human/external drivers. The first four drivers in the designer category have high loadings, indicating they are major contributors to cost variation. Financial condition of the owner has the highest loading in the building element category. Unforeseeable ground conditions has a high loading in the process stage category. Therefore, the 5
IRJET- A Review on “Impact of Large Infrastructure Project on Local Econo...IRJET Journal
This document reviews the impact of large infrastructure projects on local economies. It discusses how infrastructure projects bring development to surrounding areas through job creation, housing, education, healthcare and retail opportunities. People working on infrastructure projects need local facilities to support their families. Existing local facilities may need to be upgraded to accommodate growth from these projects. The document also reviews several other studies and literature that have examined the relationship between infrastructure development and economic growth. In general, the research shows infrastructure is crucial for economic development and acts as a foundation for society, though the exact impacts may vary in different contexts.
The Impact of Infrastructure Spending in Sub-Saharan Africa: A CGE Modeling A...Dr Lendy Spires
This working paper uses computable general equilibrium (CGE) models to compare the impact of increased infrastructure spending in six African countries. The models include seven sectors and capture country specificities. Simulations analyze the impact of investments in nonproductive, road, electricity, and telecom infrastructure under different funding schemes. The results show that economic structure influences outcomes more than the identical models. Infrastructure investments have varying sectoral effects depending on each country's trade patterns and capital-labor ratios. Foreign aid most strongly impacts sectors due to price and exchange rate adjustments needed to balance the current account.
Developing Africa’s Infrastructure for Enhanced Competitiveness 2013Dr Lendy Spires
The Africa Competitiveness Report 2013 benefit from globalization through investment and trade. To achieve this calls for the construction of an efficient and secure national and cross-border physical infrastructure as well as a coherent system of regulation for business transactions.3 Infrastructure is also critical for the promotion of inclusive and sustainable growth. Rural infrastructure— notably feeder roads and transmission lines that connect rural communities to national grids—enable individuals, households, communities, and small businesses to embark on income-generating activities thanks to improved access to electricity and links to markets. The use of renewable energy or environment-friendly sources of energy—including solar, wind, geothermal, and hydropower, with all of which Africa is well endowed— would contribute to making growth sustainable. A considerable investment in infrastructure that uses innovative sources of funding is needed to address Africa’s low level of competitiveness (see Chapter 1.1). Indeed, the Programme for Infrastructure Development in Africa (PIDA) estimates that Africa will need to invest up to US$93 billion annually until 2020 for both capital investment and maintenance.4 Given the substantial amounts involved, governments will need to be innovative in the search for sustainable approaches to infrastructure development as well as financing. The private sector will need to play an increasingly important role. Governments will do well to create conditions where private-sector engagement is encouraged, probably through public-private partnerships (PPPs). Efficiency gains from performance improvements in infrastructure provision are themselves a significant source of finance,5 and the development of infrastructure bonds as a financing vehicle will need to be encouraged. Adequate maintenance plans are prerequisites for sustainable infrastructure. Maintenance is not only corrective but also preventative because it inspects assets and reduces the risk of failure. Costs associated with statutory maintenance can be substantial—even considerably larger than the value of the asset—yet providing for these maintenance costs is crucial. Without adequate maintenance, infrastructure deteriorates quickly and is unsustainable. Indeed, the longer-term performance of the ICT sector should be reviewed in light of the adequacy of maintenance plans. Thus far, ICT sector performance has been good, albeit from a low base.
The infrastructure sourcebook provides an overview of infrastructure issues, current challenges, and proposals for managing challenges over the next 25 years. It aims to inform policymakers, leaders, and development practitioners. The sourcebook defines infrastructure components, identifies lessons from case studies, and discusses the government's roles in areas like regulations, planning, commissioning, operations, and supply chain management. It also outlines the design and delivery process for infrastructure projects.
Economic Development 411 | 2015 | Robert PalterOne Columbus
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The American Society of Civil Engineers (ASCE) is the country's oldest civil engineering organization, founded in 1852. It represents over 140,000 civil engineers. Every four years, ASCE publishes a Report Card for America's Infrastructure that grades the state of infrastructure in various categories on a scale of A to F. The 2013 report found the country's overall GPA rose slightly to a D+ from a previous D. Grades ranged from a B- for solid waste to a D- for inland waterways and levees. Most categories saw slight improvements due to increased investment, though continued underfunding leaves the majority of grades below a C.
The effect of federal infrastructure spending on private-sector productivity depends in part on the response of state and local governments and in part on how long the investment takes to become productive. Greater emphasis on particular contributions of infrastructure to productivity or different ways of allocating funds could make federal infrastructure spending more productive.
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3. ★|Contents
2 | List of Figures and Tables
2 | Preface
4 | Section 1 Introduction
6 | Section 2 Economic Impacts of Failing to Invest
Across Infrastructure Systems
14 | Section 3 Review of Infrastructure Sectors
16 | Summary of Findings from Previous Studies
16 | Surface Transportation
18 | Airports
19 | Inland Waterways & Marine Ports
19 | Electricity
20 | Water and Wastewater
22 | Section 4 Conclusions
24 | Endnotes
25 | Acknowledgments
25 | About EDR Group
Failure to Act
The Impact of
Current Infrastructure
Investment on America’s
EconomicFuture
4. 2 American Society of Civil Engineers
Every four years, the American Society of Civil
Engineers (ASCE) publishes The Report Card
for America’s Infrastructure, which grades the
current state of the nation’s infrastructure cate-
gories on a scale of A through F. In 2009, the U.S.
infrastructure earned just a D average. When
the next Report Card is released in 2013, it will
provide an updated look at the state of U.S. infra-
structure conditions, but there is also a larger
question at stake: How does a D for infrastruc-
ture affect America’s economic future?
This Failure to Act report answers the key
question of how the conditions of the United
States’ infrastructure systems affect the nation’s
economic performance. The Failure to Act report
provides this economic analysis by addressing 9
of ASCE’s 16 infrastructure categories that are
addressed in the 2013 Report Card (see table 1).
Today, perhaps more than ever, economic perfor-
mance is critical to the nation’s future.
The purpose of the Failure to Act report series
is to provide an analysis of the economic impli-
cations for the United States of continuing its
current investment trends in infrastructure. The
Failure to Act series analyzes two types of infra-
structure needs:
★★ Building new infrastructure to service
increasing populations and expanded eco-
nomic activity; and
★★ Maintaining or rebuilding existing infra-
structure that needs repair or replacement.
The four preceding reports in this series assess
the implications of present trends in infra-
structure investment for the productivity of
industries, for national competitiveness, and for
costs to households.
★|Figuresandtables
★|Preface
Figure
1 Investment Gap by Infrastructure Category as a
Percentage of Total Needs in the Years 2020 and 2040
Tables
1 Comparison of 2009 Report Card and
Failure to Act Series
2 Cumulative Infrastructure Needs by System based
on Current Trends Extended to 2020 and 2040
3 Costs to Businesses and Households of
Degrading Infrastructure
4 Impacts of Infrastructure Investment Gap
Per Household
5 The Sectors Most Negatively Affected by
Degrading Infrastructure in Terms of Business
Sales in 2020 and 2040
6 The Sectors Most Negatively Affected by
Degrading Infrastructure in Terms of Jobs
in the Years 2020 and 2040
7 The Sectors Most Negatively Affected by
Degrading Infrastructure in Terms of Value
of Exports in 2020 and 2040
8 Cumulative Impacts to the National Economy
by Category
5. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 3
Included in
2009 Report Card Failure to Act Series
Dams
Drinking Water ★
Hazardous Waste
Levees
Solid Waste
Wastewater ★
Aviation ★
Bridges ★
Inland Waterways ★
Rail ★
Roads ★
Transit ★
Parks and Recreation
Schools
Energy ★
Marine Ports ★
Note Marine ports were not evaluated in the 2009 Report Card,
but were part of the Failure to Act series and will be included in the
2013 Report Card.
Table 1★ Comparison of 2009 Report Card
and Failure to Act Series
American Society
of Civil Engineers
2009 Report Card
Failure to act Series
Failure to act
The economic impacT
Of current Investment trends In
Airports,inlAndWAterWAys,AndMArineports
Infrastructure
Failure to act
The economic impacT
Of current Investment trends In
WaterandWasteWatertreatment
Infrastructure
FAILURE TO ACT
THE ECONOMIC IMPACT
OF CURRENT INVESTMENT TRENDS IN
ELECTRICITY
INFRASTRUCTURE
FAILURE TO ACT
THE ECONOMIC IMPACT
OF CURRENT INVESTMENT TRENDS IN
SURFACETRANSPORTATION
INFRASTRUCTURE
6. 4 American Society of Civil Engineers
INTRODUCTION
Infrastructure is the physical framework upon which the U.S.
economy operates and the nation’s standard of living depends.
Everything depends on this framework, including transporting
goods, powering factories, heating and cooling office buildings,
and enjoying a glass of clean water.
The preceding four Failure to Act reports compared current
and projected needs for infrastructure investment against the
current funding trends in surface transportation; water and
wastewater; electricity; and airports, inland waterways, and
marine ports. Our projections included both the cost of building
new infrastructure to service increasing populations and the cost
of expanded economic activity; and for maintaining or rebuilding
existing infrastructure that needs repair or replacement. The
total documented cumulative gap between projected needs and
likely investment in these critical systems will be $1.1 trillion
by 2020. The subsequent analyses focused on the long-term
effects associated with infrastructure investments and did not
consider the immediate benefits associated with the construction
process. The results show that deteriorating infrastructure, long
known to be a public safety issue, has a cascading impact on
the nation’s economy, negatively affecting business productivity,
gross domestic product (GDP), employment, personal income,
and international competitiveness.
1
7. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 5
The categories of infrastructure systems ana-
lyzed in the preceding Failure to Act reports
were reviewed in isolation by each study.1
However, it is clear that there is an interactive
effect between different infrastructure sectors
and a cumulative impact of an ongoing invest-
ment gap in multiple infrastructure systems.
For example, regardless of how quickly goods
can be offloaded at the nation’s ports, if high-
way and rail infrastructure needed to transport
these goods to market is congested, traffic will
slow and costs to business will rise, creating
a drag on the U.S. economy that is ultimately
reflected in a lower GDP.
This fifth and final report analyzes the inter-
active effect between investment gaps in the
infrastructure sectors addressed in each of the
preceding studies. It presents an overall picture
of the national economic opportunity associated
with infrastructure investment and the conse-
quences of failing to fill the investment gap.
The overall impact of deficient infrastructure
associated with a general failure to invest
cannot be estimated by simply adding the
impacts found in each report because the degra-
dation of surface transportation, water delivery
and wastewater treatment, electricity, inland
waterways, and marine ports each affect busi-
ness productivity differently. Shifts to other
production methods or modes of infrastructure
may be possible given a decline in one system,
which could mitigate the economic impacts of
failing to invest in that system. For example,
rail, inland waterways, and trucks are used
to get goods to retail shelves —deteriorating
conditions in one sector tend to make the other
sectors more competitive. However, a general
decline in infrastructure conditions across mul-
tiple sectors would preclude such strategies.
In addition, the consequences of infrastruc-
ture shortfalls differ by each system. With
degrading surface transportation, trips can
still be made, but they would take longer and
be less reliable, and travel could be less safe.
Declining airport and marine port infrastructure
directly impacts the nation’s ability to import
and export goods efficiently, driving up costs
to U.S. consumers.
Overall, if the investment gap is not addressed
throughout the nation’s infrastructure sectors,
by 2020, the economy is expected to lose almost
$1 trillion in business sales, resulting in a loss
of 3.5 million jobs. Moreover, if current trends
are not reversed, the cumulative cost to the U.S.
economy from 2012–2020 will be more than $3.1
trillion in GDP and $1.1 trillion in total trade.2
Often, estimates of economic activity and
job creation focus on the design and construc-
tion period for infrastructure projects, such as a
project to rebuild an aging bridge. However, this
study focuses on the incremental and gradual
decline of infrastructure systems under cur-
rent investment scenarios, and it shows that the
negative impacts on the nation’s economy are
exacerbated over time as needed investments are
deferred. Conversely, this study demonstrates
that the economic benefits of infrastructure
investment reverberate through every sector
of the economy over time.
The results show that deteriorating infrastructure,
long known to be a public safety issue, has a
cascading impact on the nation’s economy,
negatively affecting business productivity, gross
domestic product (GDP), employment, personal
income, and international competitiveness.
8. 6 American Society of Civil Engineers
ECONOMIC IMPACTS OF FAILING TO INVEST
ACROSS INFRASTRUCTURE SYSTEMS2
In combination with current investment trends, cumulative infra-
structure investment needs will be approximately $2.7 trillion
by 2020 and will rise to $10 trillion by 2040. It is expected that
funding will be available to cover only 60% (approximately $1.7
trillion) of these needs through 2020, and that will drop to 53%
by 2040. Thus, the investment gaps will total $1.1 trillion by
2020, and will grow to $4.7 trillion by 2040.
As shown in table 2, the bulk of the gap is due
to surface transportation needs, including
roads, bridges, and transit systems. In addi-
tion, figure 1 shows the percentage of needs
for each infrastructure type and the remain-
ing unfunded investment gap.
The previous studies in the Failure to Act
series found that underinvesting in infrastruc-
ture will result in higher costs to businesses and
households as a consequence of less efficient
and more costly infrastructure services. For
example, travel times will lengthen with inef-
ficient roadways and congested air service, and
out-of-pocket expenditures to households and
business costs will rise if the electricity grid
or water delivery systems fail to keep up with
demand. Goods will be more expensive to pro-
duce and more expensive to transport to retail
shelves for households or to business customers.
Business related travel, as well as commut-
ing and personal travel, will also become more
expensive. As a consequence, U.S. businesses
will become less efficient. As costs rise, busi-
ness productivity falls, causing GDP to drop,
cutting employment and ultimately reducing
personal income. Higher costs will also render
U.S. goods and services less competitive inter
nationally, reducing exports and decreasing
dollars earned and brought into the U.S. from
sales to international customers. Impacts will
be spread throughout the economy, but will
fall disproportionately on the technology and
knowledge-based industries that drive innova-
tion and economic development.
Although the U.S. economy will still be
producing goods and services, it will do so
at a reduced scale, and the lower wages will
lead to less consumer spending. Impacts
ultimately will fall hardest on households
that will pay more for services —including
transportation, water and wastewater, and
electricity —and absorb the brunt of fewer
9. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 7
jobs, lower incomes, and higher prices for both
domestically produced and imported goods.
The reduction in business sales due to the drop
in exports, personal income and consumer spending
will eventually reduce national GDP, which a pri
mary indicator of national economic productivity.
Aggregate Economic Impacts
Businesses and households face higher costs due to
several factors, including unreliable transportation
services, less reliable water and electricity services,
and unmet maintenance needs and outdated facili-
ties for airports, marine ports, and inland water-
ways. These costs absorb funds from businesses
that would otherwise be directed to investment or
research and development, and funds from house-
holds that would go toward discretionary con-
sumer purchases. The costs are expected to total
over $1.8 trillion by 2020, as shown in table 3. Thus,
not only will business and personal income be lower
but more of that income will need to be diverted to
infrastructure-related costs. This dynamic creates
lower demand in key economic sectors associ-
ated with business investments for expansion and
research and development, and in consumer sectors.
Compared with baseline forecasts for the years
2012–20, the cumulative impact of deficient infra-
structure due to continued underinvestment in
the transportation, water, energy, and port sectors
is predicted to result in an aggregated loss of $3.1
trillion in GDP from the U.S. economy. Losses are
expected to include $484 billion in exports and
almost $1.1 trillion in total trade. As a result of this
underperformance, job losses will mount annu-
ally, and by 2020 it is predicted that there will be
3.5 million fewer jobs throughout the country.
The expected impact for every household
in the U.S. will be an average loss of more than
$3,000 per year through 2020 in disposable
personal income, amounting to $28,000 per
household over nine years, as shown in table 4.
These losses will be due to job cutbacks and
declining business productivity (which includes
less sales and lower GDP), which will result in
lower household incomes. By 2040, these effects
will be more pronounced. Based on extend-
ing identified needs and finding trends, by the
year 2040, the impacts of a cumulative $4.7 tril-
lion gap in transportation, water, energy, and
ports (including the investments through 2020)
Total Expected Funding Total Expected Funding
Infrastructure Systems Needs Funding Gap Needs Funding Gap
Surface Transportation $1,723 $877 $846 $6,751 $3,087 $3,664
Water/Wastewater $126 $42 $84 $195 $52 $144
Electricity $736 $629 $107 $2,619 $1,887 $732
Airports* $134 $95 $39 $404 $309 $95
Inland Waterways
& Marine Ports $30 $14 $16 $92 $46 $46
TOTALS $2,749 $1,657 $1,092 $10,061 $5,381 $4,681
*Airport needs and gaps include anticipated cost of NextGen: $20 billion by 2020 and $40 billion by 2040.
Table 2★ Cumulative Infrastructure Needs by System Based on Current
Trends Extended to 2020 and 2040 (Dollars in $2010 billions)
2020 2040
10. 8 American Society of Civil Engineers
includes losses of almost 7 million jobs from the
national economy. In terms of dollar losses from
expected levels in 2040 are $2.5 trillion in busi-
ness sales, including $473 billion in exports ($712
billion in total trade), $1.3 trillion in national
GDP, and $1.2 trillion in disposable personal
income that would be lost to U.S. households.
Per household, the expected loss of dispos-
able personal income is estimated to exceed
$6,000 annually from 2021 to 2040, which adds
to $126,000 over the 20-year time frame. On aver-
age, the cost of deficient infrastructure is expected
to reach $5,400 per year for each household in the
nation from 2012 to 2040, as shown in table 4.
From 2012 until 2020, consumer spending will
drop by almost $2.4 trillion as a consequence of
the declines in disposable income. Although con-
sumer spending is calculated to decline in each of
the preceding Failure to Act studies, the effect is
particularly pronounced when examining impacts
on all the infrastructure systems together.
Nationally, the cumulative loss in national
business sales3
will be almost $6 trillion over
the years 2012-2020. Nearly $34 trillion more
Source Data taken from previous Failure to Act studies.
Figure 1★ Investment Gap by Infrastructure Category as a Percentage of
Total Needs in the Years 2020 and 2040
2020 2040
Surface
Transportation
Water/Wastewater
Electricity
Airports
Inland Waterways
& Marine Ports
Surface
Transportation
Water/Wastewater
Electricity
Airports
Inland Waterways
& Marine Ports
Funded funding gap Funded funding gap
51% 49% 46% 54%
33% 67% 27% 73%
85% 15% 72% 28%
71% 29% 76% 24%
47% 53% 50% 50%
11. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 9
Infrastructure Systems households businesses total
Surface Transportation $481 $430 $911
Water/Wastewater $59 $147 $206
Electricity $71 $126 $197
Airports N/A $258 $258
Inland Waterways & Marine Ports N/A $258 $258
TOTALS $611 $1,219 $1,830
Note Dollars in $2010 Billions. Costs do not include personal income or value of time other than business travel.
Table 3★ Costs to Businesses and Households of Degrading Infrastructure
2012-2020 2021-2040 2012-2040
Average Annual Disposal Income Per Household – $3,100 – $6,300 – $5,400
Total Disposal Income Per Household – $28,300 – $126,300 – $157,200
Note Dollars rounded to nearest $100. Totals may not multiply due to rounding.
Sources LIFT/Inforum Model of the University of Maryland, and EDR Group.
Table 4★ Impacts of Infrastructure Investment Gap Per Household
Cumulative to 2020
Infrastructure Systems households businesses total
Surface Transportation $1,880 $1,092 $2,972
Water/Wastewater $616 $1,634 $2,250
Electricity $354 $640 $994
Airports N/A $1,212 $1,212
Inland Waterways & Marine Ports N/A $1,233 $1,233
TOTALS $2,850 $5,811 $8,661
Note Dollars in $2010 Billions. Costs do not include personal income or value of time other than business travel.
Cumulative to 2040
12. 10 American Society of Civil Engineers
Sources LIFT/Inforum Model of the University of Maryland, and EDR Group.
*Excludes auto repair services.
Sector Business Sales/Output
Retail trade – $95
Water and sanitary services – $76
Restaurants and bars – $55
Finance & insurance – $51
Electric utilities – $46
Hotels – $36
Medical Services – $35
Advertising – $34
Personal & repair services* – $25
Gas utilities – $23
Computer & data processing – $21
Wholesale trade – $21
Other instruments – $19
Other business services – $18
Agriculture, forestry, fisheries – $17
Other Sectors – $386
Total – $958
Sector Business Sales/Output
Finance & insurance – $204
Retail trade – $172
Real estate and royalties – $159
Wholesale trade – $132
Owner-occupied housing – $115
Professional services – $100
Other business services – $94
Medical Services – $94
Computer & data processing – $82
Air transport – $62
Restaurants and bars – $59
Maintenance & repair – $59
Aerospace – $58
Agriculture, forestry, fisheries – $54
Movies and amusements – $50
Other Sectors – $1,037
Total – $2,529
Table 5★
The Sectors Most Negatively Affected by Degrading Infrastructure
in Terms of Business Sales in the Years 2020 and 2040
(Dollars in $2010 billions)
2020 2040
13. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 11
Sources LIFT/Inforum Model of the University of Maryland, and EDR Group.
Sector jobs
Retail trade – 786,000
New construction – 394,000
Medical Services – 298,000
Other business services – 294,000
Restaurants and bars – 272,000
Finance & insurance – 245,000
Wholesale trade – 228,000
Education, social services, NPO – 213,000
Professional services – 154,000
Movies and amusements – 102,000
Printing & publishing – 67,000
Air transport – 63,000
Automobile services – 58,000
Real estate and royalties – 57,000
Computer & data processing – 54,000
Other Sectors – 178,000
Total – 3,463,000
Sector jobs
Retail trade – 1,198,000
New construction – 753,000
Medical Services – 638,000
Wholesale trade – 601,000
Restaurants and bars – 558,000
Other business services – 549,000
Education, social services, NPO – 437,000
Finance & insurance – 358,000
Professional services – 298,000
Movies and amusements – 249,000
Air transport – 191,000
Printing & publishing – 126,000
Computer & data processing – 109,000
Real estate and royalties – 107,000
Personal & repair services, ex. auto – 89,000
Other Sectors – 598,000
Total – 6,859,000
Table 6★
The Sectors Most Negatively Affected by Degrading
Infrastructure in Terms of Jobs in the Years 2020 and 2040
(Dollars in $2010 billions)
2020 2040
14. 12 American Society of Civil Engineers
in sales are predicted to be lost from 2021-2040.
The aggregate loss of GDP from the U.S. econ-
omy is expected to be $3.1 trillion cumulatively
over the years 2012-2020, and an additional $18
trillion from 2021 through 2040.
By 2020, the economy is expected to lose
almost 3.5 million jobs, and mounting impacts
from underinvestment in infrastructure will
result in nearly 7 million jobs lost by 2040.4
Tables
5 and 6 show that the economic benefits of infra-
structure investment reverberate through every
sector of the economy and are exacerbated over
time as needed investments are deferred.5
Tables 5 and 6 show that the impacts by
sector will shift by 2040, as the gaps between infra-
structure needs and investment widens and the
economy has time to adjust to lower levels of ser-
vices. Large, labor-intensive industries such as
retail, medical services, and restaurants will be
particularly hard hit by 2040. This is the long-term
result of households earning less disposable income
and reducing purchases (restaurant meals, home
improvements, consumer electronics, new furniture
for examples), deferring services (medical care),
and the long-term reduction in business sales that
will particularly affect construction spending.
By 2040, the key sectors related to America’s
innovation and knowledge base —including aero-
space, air transportation, business services, profes-
sional services, and finance —will all be among
the hardest-hit in terms of sales and industry sales.
Primarily, these impacts are due to: (1) fewer pur-
chases for higher priced goods and services by both
households and businesses in adjusting to declin-
ing business sales and lower disposable personal
income; (2) higher production costs, transporta-
tion costs and a less efficient supply chain reduces
the competitiveness of U.S. produced exports; (3)
supply-chain impediments, including the costs of
transportation, inefficiencies at ports that increase
the costs of products; and (4) a redistribution of
business revenues from R&D, major purchases and
higher priced business services in order to pay for
higher costs of transportation, water and energy.
Even though net job impacts are counted
in millions of jobs lost from the U.S. due to
insufficient infrastructure investment, overall
economic impacts in dollars lost in the econ-
omy, measured by business sales and GDP will
be more dramatic than impacts on overall num-
ber of jobs. Job losses in part will be mitigated
by more people working for less money. Many
of these jobs will replace technology-based and
education industry jobs that are the basis of
long-term economic development.
In 2020, the United States population is pre-
dicted to exceed 340 million people and the
national population is expected to grow to more
than 400 million by 2040. Workers will still be
needed to provide basic and a reduced level of
luxury products and services to this population.
The impact of declining business productivity
due to inefficient infrastructure may add some
jobs to the economy even as income is declin-
ing. As an example, in 2020 and 2040, deficient
infrastructure is expected to negatively affect
the value of agriculture sales and exports as
shipping costs rise. However, even though this
sector’s sales and exports will fall, more workers
will be needed in 2020 to produce and supply its
products, as shown in table 7. Other sectors that
will increase job shares by 2020 are automobile
repair services, truck driving, and highway pas-
senger services. These findings are consistent
with those of the previous Failure to Act study
on surface transportation, because poor pave-
ment conditions and deficient roads will cause
more damage to vehicles, slower travel times will
require more drivers and crews, and a degrading
inland waterway system and congested air space
will lead more people to travel by car and more
goods to be shipped by truck.
Table 7 presents data on those industries that
will be most affected by a decline in exports
in 2020 and 2040. These industries include a
cross-section of critical sectors of the national
economy, including finance, aerospace, instru-
ments, and communications. These industries
also represent basic manufacturing and services,
including wholesale trading, equipment, and
agricultural products.
15. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 13
Sources LIFT/Inforum Model of the University of Maryland, and EDR Group.
Sector Value
Finance & insurance – $9
Wholesale trade – $7
Aerospace – $6
Agriculture, forestry & fisheries – $5
Air transport – $4
Other chemicals – $3
Professional services – $2
Other instruments – $2
Petroleum refining – $2
Ag., const. & material
handling equipment – $2
Drugs – $2
Meat products – $2
General & misc. industrial equipment – $2
Communications equipment – $2
Motor vehicle parts – $2
Other Sectors – $41
Total – $106
Sector Value
Finance & insurance – $50
Aerospace – $47
Wholesale trade – $35
Air transport – $31
Agriculture, forestry & fisheries – $18
Communications equipment – $15
Professional services – $13
Other instruments – $13
Other chemicals – $13
Meat products – $10
Electronic components – $9
Ag., const. & material
handling equipment – $8
Computer & data processing – $7
Plastics & synthetics – $7
Medical instruments & supplies – $7
Other Sectors – $188
Total – $517
Table 7★
The Sectors Most Negatively Affected by Degrading
Infrastructure in Terms of Value of Exports in 2020 and 2040
(Dollars in $2010 billions)
2020 2040
16. 14 American Society of Civil Engineers
REVIEW OF INFRASTRUCTURE SECTORS3
Each of the specific infrastructure studies that were con-
ducted in the Failure to Act series was based on assuming
extending current needs through 2040, recent funding
trends, and trends in how infrastructure is being used.
The projected needs for investments in infrastructure
systems, and the consequent costs to industries and house-
holds of not making these investments, are documented by
models used by federal infrastructure agencies; databases;
reports published by federal agencies and by industry
groups that represent local, regional, and private sector
infrastructure providers; academic and professional
literature; and interviews with industry experts. Economic
impacts were calculated using the LIFT model (Long-Term
Interindustry Forecasting Tool) of the Inforum Interindus-
try Forecasting Project at the University of Maryland.
17. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 15
Business Sales
Through 2020 $1,700 $580 $1,335 $847 $734
2021–2040 $7,062 $2,682 $6,496 $3,590 $6,791
GDP
Through 2020 $897 $313 $697 $496 $416
2021–2040 $1,765 $1,209 $3,278 $1,954 $3,702
Jobs
2020 877,000 350,000 738,000 529,000 669,000
2040 410,000 358,000 1,384,000 366,000 1,377,000
Disposable Income
Through 2020 $930 $361 $872 $656 $541
2021–2040 $2,205 $1,128 $3,662 $2,294 $4,440
Value of Exports
Through 2020 $114 $54 $270 $51 $20
2021–2040 $1,093 $708 $1,712 $630 $807
Table 8★ Cumulative Impacts to the National Economy by Category
(Dollars are in $2010 billions)
Sources LIFT/Inforum Model of the University of Maryland, and EDR Group.
Note This Table reflects the research conducted in 2011 and 2012 and findings of the four infrastructure sector studies that preceded
this report. Jobs rounded to the nearest thousand.
Water /
Wastewater
Electricity
Inland Waterways
& Marine Ports
Airports
Surface
Transportation
18. 16 American Society of Civil Engineers
Summary of Findings from Previous Studies
The projected annual impacts of the infrastruc-
ture systems reviewed are shown for 2020 and
2040 in table 8. It is important to note that in
some cases the national economy is expected to
adjust from the degradation of infrastructure. In
particular, annual losses in GDP and income will
be similar in 2020 and 2040 because inadequate
investment in surface transportation and job
impacts are expected to be cut in half between
these two years. These numbers, however, mask
the dynamic that job increases will be in those
industries that address poor roadway conditions
and that job losses will continue to be seen in the
U.S. knowledge-based and innovation industries
that drive economic development.
The studies did not presume new technolo-
gies, or expanded technologies not currently
scheduled for implementation. Examples of such
technologies not considered in these reports
are high-speed rail or maglev systems in sur-
face transportation and a radical expansion of
renewable energy for electricity generation. The
electricity study assumed that technologies in
place or planned for power generation by region
would be in place through 2040. For aviation, the
costs of the Next Generation Air Transportation
System’s (NextGen’s) technologies were consid-
ered as part of the gap, and likely air congestion
without NextGen was part of the basis for esti-
mating future economic impacts.
Surface Transportation
The nation’s surface transportation infrastructure
includes the critical highways, bridges, railroads,
and transit systems that enable people and goods
to access the markets, services, and inputs of pro-
duction that are essential to America’s economic
vitality. For many years, the nation’s surface trans-
portation infrastructure has been deteriorating.
However, because this deterioration has been dif-
fused throughout the nation, and has occurred
gradually over time, its true costs and economic
impacts have not always been immediately appar-
ent. In practice, the transportation funding that
is appropriated is spent on a mixture of system
expansion and preservation projects. Although
these allocations have often been sufficient to
avoid the imminent failure of key facilities, the
continued deterioration leaves a significant and
mounting burden on the U.S. economy.
Across the U.S., regions are affected
differently by deficient and deteriorating infra-
structure. The most affected regions are those
with the largest concentrations of urban areas,
because urban highways, bridges, and transit
systems are generally in worse condition today
than rural facilities. Peak commuting patterns
also place larger burdens on the capacities of
urban areas. However, because the nation is
so dependent on the Interstate Highway Sys-
tem, impacts on interstate performance in some
regions or areas are felt throughout the nation.
Nationally, for highways and transit, 630
million vehicle hours traveled were lost due to
congestion in 2010. This total is expected to triple
to 1.8 billion hours by 2020 and further increase
to 6.2 billion hours in 2040. These vehicle hours
understate person hours and underscore the
severity of the loss in productivity.
Deteriorating conditions and performance
impose costs on American households and
19. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 17
businesses in a number of ways. Facilities in poor
condition lead to increases in operating costs for
trucks, cars, and rail vehicles. Additional costs
include damage to vehicles from deteriorated road-
way surfaces, the imposition of both additional
miles traveled, time expended to avoid unusable or
heavily congested roadways or due to the break-
down of transit vehicles, and the added cost of
repairing facilities after they have deteriorated, as
opposed to preserving them in good condition. In
addition, increased congestion decreases the reli-
ability of transportation facilities, meaning that
travelers are forced to allot more time for trips to
assure on-time arrivals (and for freight vehicles,
on-time delivery). Moreover, congestion increases
environmental and safety costs by exposing more
travelers to substandard conditions and requiring
vehicles to operate at less efficient levels as condi-
tions continue to deteriorate.
Surface transportation costs are imposed
primarily by pavement and bridge conditions,
highway congestion, and transit and train vehicle
conditions that are operating well below mini-
mum tolerable levels for the level of traffic they
carry. In 2010, it was estimated that deficien-
cies in America’s surface transportation systems
cost households and businesses nearly $130 bil-
lion. This included approximately $97 billion in
vehicle operating costs, $32 billion in travel time
delays, $1.2 billion in safety costs, and $590 mil-
lion in environmental costs. If present trends
continue, by 2020 the annual costs imposed on
the U.S. economy from deteriorating surface
transportation infrastructure will increase to
$210 billion, and by 2040 to $520 billion —with
cumulative costs mounting to $912 billion and
$2.9 trillion by 2020 and 2040, respectively.
By 2020, America’s projected surface trans-
portation infrastructure deficiencies —in a
scenario of extended trends —are expected
to cost the national economy cumulatively
almost $900 billion in GDP, rising to $2.7 tril-
lion through 2040. In 2020, nearly 900,000 jobs
are expected to be lost. By 2040, these gross job
losses will be mitigated to slightly more than
400,000 jobs, but a greater proportion of this
apparent job rebound will be due to the need to
expand industries associated with automotive
repairs. Moreover, as productivity deteriorates
along with infrastructure degradation, more
resources will be wasted in each sector. In other
words, it may take two jobs to complete the tasks
that one job could handle without delays due
to worsening surface transportation. By 2040,
approximately 1.3 million more jobs could exist
in key knowledge-based and technology-related
economic sectors if sufficient transportation
infrastructure were maintained. These losses
would be balanced against almost 900,000
additional jobs projected in traditionally lower-
paying service sectors of the economy that would
benefit from deficient transportation (such as
auto repair services) or from declining produc-
tivity in domestic service-related sectors (such as
truck driving and retail trade).
By 2020, America’s projected surface
transportation infrastructure deficiencies
are expected to cost the national economy
cumulatively almost $900 billion in GDP,
rising to $2.7 billion through 2040.
20. 18 American Society of Civil Engineers
of needs and spending documented by the FAA
and Airports Council International shows an
annual capital gap of about $2 billion through
2020 (roughly $13 billion in need and $11 bil-
lion in expenditures per year) and $1 billion
annually from 2021 to 2040 ($12 billion in need
and $11 billion in expenditures, assuming that
spending through 2020 does not fall lower than
recent trends). In addition to construction needs,
congestion relief is being proposed through
NextGen, which is expected to transform the
management and operation of the air transpor-
tation system in the United States, moving from
the current ground-based radar system to a sat-
ellite-based system. At present the most widely
accepted cost of NextGen is $31 billion, in addi-
tion to approximately $9 billion that has already
been invested between 2003 and 2011.
The implications of these investment needs
are expected to result in a cumulative impact on
the U.S. economy. Anticipated growth of aircraft
operations and passengers at major airports will
lead to delays for cargo movement and business
travel, assuming that capital spending remains
consistent through 2040 as it has been from 2001
(about $10 billion annually in 2010 value). The
broad impacts on the U.S. economy would repre-
sent a cumulative loss of GDP amounting to $313
billion by 2020 and $1.52 trillion by 2040. Over-
all, the U.S. economy will end up with an average
of 350,000 fewer jobs than it would otherwise
have by 2020 and 358,000 fewer jobs in 2040.
Airports
Among the 3,300 airports in the United States
that are designated by the Federal Aviation
Administration (FAA) as important to the
national aviation system, 35 airports with the
nation’s top 15 markets account for 80 percent
of U.S. passenger origin and destination move-
ments, totaling 343 million trips. The FAA
forecasts that enplanements in these 15 markets
will increase 30% by 2020 and 121% by 2040.6
These projections exceed enplanements fore-
casted at other commercial airports, which are
predicted to increase 25% by 2020 and 93% by
2040. More important from the perspective of
air traffic projections, commercial aircraft oper-
ations are projected to grow by 17% through
2020 and 62% by 2040, including increases in
the 15 major markets of 23% by 2020 and 86% by
2040. Similar to passenger travel, freight ship-
ments are concentrated in major metro areas. By
tonnage, 92% of international air freight tonnage
is imported or exported through the 15 leading
U.S. customs districts, and 70% of domestic air
tonnage originates at key metro markets.
The most significant economic threat con-
cerning aviation is air and ground congestion at
major airports and regions. Extending the trends
The most significant economic threat
concerning aviation is air and ground
congestion at major airports and regions.
21. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 19
Inland Waterways
& Marine Ports
The U.S. inland waterway system consists of
over 12,000 miles of inland and intracoastal
waterways, with over 240 lock chambers, along
with over 300 commercial harbors. Domes-
tically, this system accounts for 10% of all
tonnage moved in the United States and almost
20 percent of the total value of all freight trans-
ported over the entire U.S. transportation
system. This includes approximately 56% of all
crude petroleum, 15% of all coal, and 24% of
other fuel oils, which alone affect the efficiency
of all economic sectors that rely on energy. In
addition, 70% of U.S. imports arrive by water,
including 86% of crude petroleum imports, as
well as approximately 76% of U.S. exports (by
tonnage), accounting for approximately 35% of
total exports by value.
If America’s current level of investment in its
inland waterways and marine ports continues,
the losses to its economy will increase shipping
costs. The toll of these impacts will be seen in
GDP losses that will accumulate every year —
from a loss of almost $95 billion in 2020 to over
$255 billion by 2040. The cumulative loss in
national GDP through 2040 will be over $4.0
trillion —driven by the rising costs to import
and export goods and declining competitive-
ness. In turn, these effects will result in over
738,000 fewer jobs in 2020. By 2040, the job
losses will grow to over 1.3 million —jobs that
will be lost by the nation’s lack of competitive-
ness in global trade and because households
and businesses will be spending more for com-
modities that move within the U.S. on inland
waterways and for goods that are imported.
Electricity
Electricity relies on an interconnected system
that is composed of three distinct elements:7
1. Generation facilities —including approxi-
mately 5,800 major power plants and
numerous other smaller generation facilities;
2. High-voltage transmission lines —a network of
over 450,000 miles that connects generation
facilities with major population centers; and
3. Local distribution systems that bring electric
power into homes and businesses via over-
head lines or underground cables.
The United States’ system of generation, trans-
mission, and distribution facilities was built over
the course of a century. Centralized electric gen-
erating plants with local distribution networks
were started in the 1880s, and the grid of inter-
connected transmission lines was started in the
1920s. Today, the U.S. system is a complex patch-
work system of regional and local power plants,
power lines, and transformers that have widely
varying ages, conditions, and capacities.
Nationally, extending current trends leads to
funding gaps in electric generation, transmis-
sion, and distribution that are projected to grow
over time to a level of $107 billion by 2020, about
$11 billion per year, and almost $732 billion by
2040. By 2020, distribution and transmission
infrastructure are expected to account for more
than 88% of the investment gap and generation
infrastructure to represent roughly 11.5%. By
2040, however, generation infrastructure will
potentially be the most costly element of the
gap, accounting for 55% of the total, with trans-
mission accounting for 15%, and distribution
accounting for 30%. This would be a reversal
from 2020, when generation is seen as the best-
funded element of electricity infrastructure
22. 20 American Society of Civil Engineers
due to investments made during the preced-
ing decade. The projected investment gap will
be due to some combination of aging equipment
and capacity bottlenecks that lead to the same
general outcome —a greater incidence of electric-
ity interruptions. The interruptions may occur
in the form of equipment failures, intermit-
tent voltage surges, power quality irregularities
due to equipment insufficiency, and blackouts
or brownouts as demand exceeds capacity for
periods of time. These periods could be unpre-
dictable in frequency and length, but the end
result would be a loss of reliability in electricity
supply that imposes direct costs to households
and businesses. A failure to meet the projected
gap would cost households $6 billion in 2012,
$71 billion by 2020, and $354 billion by 2040. It
would cost businesses $10 billion in 2012, $126
billion by 2020, and $641 billion by 2040.
If future investment needs are not addressed
to upgrade the nation’s electric generation, trans-
mission, and distribution systems, the economy
will suffer. Costs may occur in the form of higher
costs for electric power, costs incurred because
of power unreliability, or costs associated with
adopting more expensive industrial processes.
Ultimately, these costs all lead to the same eco-
nomic impact: the diversion of household income
from other planned expenditures to cover these
increased costs. As costs to household and busi-
nesses associated with service interruptions rise,
GDP will fall by a total of $496 billion by 2020.
The U.S. economy will end up with an average of
529,000 fewer jobs than it would otherwise have
by 2020. Even with economic adjustments occur-
ring later on, with catch-up investments, the
result would still be 366,000 fewer jobs in 2040.
Water / Wastewater
Of all the infrastructure types, water is the
most fundamental to life, and is irreplaceable
for drinking, cooking, and bathing. Farms in
many regions cannot grow crops without irriga-
tion. Government offices, hospitals, restaurants,
hotels, and other commercial establishments can-
not operate without clean water. Moreover, many
industries —for example, food and chemical man-
ufacturing and power plants —could not operate
without the clean water that is a component of
finished products or that is used for industrial
processes or cooling. Drinking-water systems col-
lect source water from rivers and lakes, remove
pollutants, and distribute safe water. Wastewater
systems collect used water and sewage, remove
contaminants, and discharge clean water back
into the nation’s rivers and lakes for future use.
Wet weather investments, such as sanitary sewer
overflows, prevent various types of pollutants
like sewage, heavy metals, and fertilizer from
lawns from ever reaching the waterways.
Delivery of water and wastewater services in
the United States is decentralized and strained.
Approximately 54,000 drinking water systems
collectively serve more than 264 million people
(more than half the nation’s public drinking-
water systems serve fewer than 500 people).
In addition, almost 15,000 wastewater treatment
facilities and 20,000 wastewater pipe systems
are spread across the U.S. as of 2008.
Although access to centralized treatment
systems is widespread, the condition of many of
these systems is also poor, with aging pipes and
inadequate capacity leading to the discharge of
an estimated 900 billion gallons of untreated
sewage each year. As the U.S. population has
increased, the percentage served by public water
systems has also increased. Each year new water
lines are constructed to connect more distant
23. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 21
dwellers to centralized systems, continuing
to add users to aging systems. Although new
pipes are being added to expand service areas,
drinking-water systems degrade over time,
with the useful life of component parts ranging
from 15 to 95 years. Failures in drinking-water
infrastructure can result in water disruptions,
impediments to emergency response, and dam-
age to other types of essential infrastructure. In
extreme situations caused by failing infrastruc-
ture or drought, water shortages may result in
unsanitary conditions, increasing the likelihood
of public health issues.
The U.S. Environmental Protection Agency
estimated the cost of the capital investment that
is required to maintain and upgrade drinking-
water and wastewater treatment systems across
the U.S. in 2010 as $91 billion. However, only $36
billion of this $91 billion was funded, leaving a
capital funding gap of nearly $55 billion. Water-
related infrastructure in the United States is
clearly aging, and investment is not able to keep
up with the need. If current trends continue, the
investment required will amount to $126 billion
by 2020, and the anticipated capital funding
gap will be $84 billion. Moreover, by 2040, the
needs for capital investment will amount to $195
billion and the funding gap will have escalated
to $144 billion, unless strategies to address the
gap are implemented in the intervening years
to alter these needs.
By 2020, the predicted deficit for sustaining
water delivery and wastewater treatment
infrastructure will be $84 billion. This may
lead to $206 billion in increased costs for busi-
nesses and households between now and 2020.
In a worst case scenario, the U.S. will lose nearly
700,000 jobs by 2020. Unless the infrastructure
deficit is addressed by 2040, 1.4 million jobs
will be at risk in addition to what is otherwise
anticipated for that year.
The impacts on jobs are a result of costs to busi-
nesses and households managing unreliable water
delivery and wastewater treatment services, and
will be spread throughout the economy. More-
over, the situation is expected to worsen as the
gap between needs and investment continues to
grow over time. In 2020, almost 700,000 jobs will
be threatened, which will grow to 1.4 million jobs
by 2040. By 2020, the nation will have lost over
$400 billion in GDP, while the cumulative impact
through 2040 is expected to be almost $4 trillion.
Water-related infrastructure in the United
States is clearly aging, and investment is not
able to keep up with the need. If current trends
continue, the investment required will amount
to $126 billion by 2020, and the anticipated
capital funding gap will be $84 billion.
24. 22 American Society of Civil Engineers
Conclusions
The U.S. economy relies on low transportation costs and the
reliable delivery of clean water and electricity to businesses and
households to offset higher wage levels and costs of production
when compared with many of America’s competitors. However,
this report series shows that business costs and therefore
prices will increase if surface transportation systems worsen;
ports and inland waterways become outdated or congested;
and if water, wastewater, and electricity infrastructure systems
deteriorate or fail to keep up with changing demand. Greater
costs to transport the wide array of imported goods that supply
U.S. domestic manufacturers and rising costs for exports will
affect the nation’s ability to compete in global markets for
goods produced in the U.S., while irregular delivery of water
and wastewater services and electricity will make production
processes more expensive and divert household disposable
income to these basic necessities.
4
25. Failure to Act: The Impact of Infrastructure Investment on America’s Economic Growth 23
Higher business costs will be incurred due to
deteriorating infrastructure in terms of charges
for services and efficiency, which will lead to
higher costs incurred by households for goods
and services due to the rising prices passed on
by businesses. The result of these effects will be
a reduction in disposable income and reduced
spending for consumer goods and services,
which will further exacerbate business impacts.
Moreover, over time, these impacts will affect
the means for businesses to provide well-paying
jobs, further reducing incomes.
The results of this final study underscore the
findings of the preceding reports in the Failure to
Act series. Often, estimates of economic activity
and job creation focus on the design and construc-
tion period for infrastructure projects. Generally,
in these type of analyses, the construction impacts
rise with the magnitude of infrastructure invest-
ment. However, these studies demonstrate that
the economic benefits of infrastructure invest-
ment reverberate through every sector of the
economy and are exacerbated over time as needed
investments are deferred, in addition to the eco-
nomic “shock value” of construction spending.
The analyses presented in the previous stud-
ies show that deteriorating infrastructure affects
businesses and households in various ways,
leading to reductions in business efficiencies,
increasing business costs, and increasing costs of
goods and services to households. The findings of
this final report show that the weakening of mul-
tiple infrastructure systems will have a greater
effect overall than a simple adding up of the
impacts for the individual infrastructure studies.
Several core reasons explain this effect. First,
if one transportation system fails, another system
can be used in some cases. For example, if airports
are too congested, passengers can drive or use
trains, and cargo can be shipped by truck, rail, or
inland waterways. However, this substitution is
not possible if multiple systems deteriorate. More-
over, every trip to and from an airport, marine
port, and an inland port is by some form of surface
transportation. Second, the efficient operations of
different infrastructure systems depend on each
other. For example, power plants use water to gen-
erate electricity (for boiling water to create steam
and for cooling).8
Thus, electricity and water are
needed to manufacture parts for transportation
vehicle repairs and materials for road repairs.
Transportation of all modes is required to deliver
parts and equipment to all types of infrastructure
systems, including transportation facilities.
Sustainable policies and personal choices
will not fix America’s infrastructure, but they
can reduce wear and tear, and thereby extend
the useful lives of the nation’s infrastructure
systems. In turn, this could extend the time
frame for the full levels of investments suggested
in these studies and may mitigate some of the
economic consequences of not funding invest-
ment. More research on tying sustainable
practices to infrastructure investment would
be a valuable contribution for understanding
the trade-offs that must be faced both nationally
and regionally.
The five reports in the Failure to Act series
are analytical and do not offer policy or funding
prescriptions. Each report suggests that more
research is needed to document the demand
response —that is, how businesses and house-
holds will adjust demand based on changes in
the efficiencies and costs of infrastructure ser-
vices, which may affect the level of investment
funding from each of these traditional sources.
Regardless of the policy solutions, the Failure
to Act series demonstrates that maintaining
and modernizing out nation’s infrastructure
has long-term economic implications.
26. 24 American Society of Civil Engineers
★|Endnotes
1. The single exception is that the logic of the airports,
inland waterways, and marine ports study is that ports
require ground access to and from these facilities.
2. Note that these are single-year impacts for 2020 and
2040, not cumulative totals.
3. Output is primarily business sales but also includes
spoilage/breakage and unsold inventory.
4. Note that these are single-year impacts for 2020 and
2040, not cumulative totals.
5. Although the data shown in table 5 are net impacts
to the economy, it should be noted that economic sectors
will gain jobs and/or business sales above projected
levels in order to serve needs caused by declining infra-
structure performance.
6. An “enplanement is a passenger boarding. The FAA
uses revenue passenger boardings (enplanements)
and cargo data to calculate the apportionments that
determine apportionment formula for the Airport
Improvement Program.
7. The first two elements are usually referred to as the
bulk power system.
8. See P. Torcellini et al., Consumptive Water Use for
U.S. Power Production (Washington: National Renewable
Energy Laboratory, U.S. Department of Energy, 2003).
27. ABOUT EDR GROUP
Economic Development Research Group, Inc.
(EDR Group) focuses specifically on applying state-
of-the-art tools and techniques for evaluating
economic development performance, impacts and
opportunities. The firm was started in 1996 by a core
group of economists and planners who are specialists
in evaluating impacts of infrastructure services and
technology on economic development opportunities.
The firm provides consulting and analysis services
to private and public-sector clients across the U.S.,
Canada and overseas. This includes benefit-cost,
economic impact, and cost-effectiveness studies
for projects, programs and policies. These efforts
support economic development strategies, planning
processes and public investment decision-making.
In addition, EDR Group provides software tools
to assist others in conducting economic analysis,
including tools for assessing transportation, energy
and economic development investments. EDR Group
provides a large collection of its economic impact
analysis studies and information on analysis tools,
which can be found at www.edrgroup.com.
ACKNOWLEDGMENTS
EDR Group wishes to thank Brian Pallasch,
Emily Fishkin, Jane Howell and Brittney Kohler
of ASCE staff for their ongoing support as these
studies were conducted. We also want to thank
the members of ASCE’s Committee on America’s
Infrastructure, for the opportunity to conduct this
research. We gratefully acknowledge the assistance
of Jeffrey Werling, Ron Horst, and Doug Mead of
the University of Maryland Economics Department.
We gratefully acknowledge the firms of LaCapra
Associates and Downstream Technologies for their
collaboration in developing the electricity and water/
wastewater analyses. In addition, we are indebted to
the staff of federal agencies, subject matter experts
and industry organizations that shared their data
and insights with us, were sounding boards for
initial analyses and reviewed draft reports.
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